Malaysian crude palm oil rebounded on Wednesday, recouping the previous day's losses, as traders covered short positions following gains in oil and hopes that weather concerns in the US will continue to support grain markets. The benchmark October contract on Bursa Malaysia's Derivatives Exchange ended up 35 ringgit or 1.44 percent to 2,459 ringgit ($765) a tonne.
Overall volumes stood at 16,473 lots of 25 tonnes each, more than the usual 10,000 lots. "It's fresh buying on firmer crude oil and weather uncertainty in the US midwest that lifted the market," said a trader in a local-brokerage firm.
An expectation of low end-stock due to hot weather, which may slow palm oil production, alongside good demand ahead of Ramazan in August also spurred the market higher, the trader said. Another trader said palm oil will continue its uptrend in the coming days and may test the 2,500 ringgit level this week. On Wednesday, the most active US soyaoil for December delivery edged up 0.05 percent while the most active January soyaoil contract on China's Dalian Commodity Exchange rose 0.32 percent.
INDONESIA PALM TRADES: The Jakarta-based PT KPB Nusantara, formerly known as the state marketing centre, sold 6,500 tonnes of crude palm oil offered in an auction on Wednesday with top price at 7,418 rupiah ($0.821) per kg, against 7,353 rupiah per kg on previous day.
There was no auction in Medan, home to Indonesia's main palm oil export port of Belawan in Sumatra island. Refiners in Jakarta offered refined, bleached, deodorised (RBD) palm oil, used for cooking oil, at 7,900 rupiah per kg, from 7,800 rupiah per kg on previous day.